What is SEF (Special Education Fund) Allowance for Teachers?

SEF (Special Education Fund): Under Republic Act (RA) No. 7160 (Local Government Code [LGC] of 1991), a province or city, or a municipality within the Metropolitan Manila Area, may levy and collect an annual tax of one percent (1%) on the assessed value of real property in addition to the basic real property tax. The additional 1% tax on real property collected in the province is shared equally by the province and the municipality within its territorial jurisdiction. On the other hand, cities keep all of their collection. The proceeds from this special levy accrue to the SEF – Special Education Fund and are automatically released to the LSB (Local School Board).

The SEF – Special Education Fund provides the source of funds for the supplementary annual budgetary needs for the operation and maintenance of public schools within the province, city, or municipality through an annual SEF – Special Education Fund Budget. The formulation, approval, and utilization of the SEF Budget are the responsibility of the individual LSB in each province, city or municipality.

ACT Teachers Party-List Representatives Antonio Tinio and France Castro join teacher-leaders last February 1, 2017 at a press conference against Joint Circular 1, series of 2017 issued by the Department of Budget and Management, Department of Education and Department of Interior and Local Government removing the allowances given by local government units to Department of Education-hired teachers as expenses chargeable to the Special Education Fund, effectively prohibiting these allowances.

“Nationally-paid teachers will lose their local allowances like those in Manila (P1,000), Mandaluyong (P1,500), Paranaque (P3,000), Makati (P2,000), Muntinlupa, (P2,000), Quezon City (P1,000), Marikina (P2,000), and others,” claimed Castro. “In effect, this Joint Circular reverses the rules which LGUs have been following for nearly 20 years enabling them to help all public school teachers in their jurisdictions by granting them local allowances sourced from the Special Education Fund or SEF.”

Castro was referring to Joint Circular 1, series of 1998 which states that “payment of existing allowances of teachers” are among the expenses chargeable to the SEF, or the additional 1% tax on real property. The 1998 Circular implemented the provisions of the Local Government Code on the SEF, classifying allowances under “operation and maintenance of public schools” which the law allows as proceeds of the SEF.

Issued last January 19, the new Joint Circular 1 replaces the old SEF guidelines and no longer lists local allowances among the expenses chargeable to the SEF.

“Local governments have been granting teachers allowances to augment their meager salaries, and due to the reality that teachers themselves pay for teaching supplies and even furniture—things which, strictly speaking, are for the operation and maintenance of public schools,” emphasized Castro. “This is a historical recognition that both the compensation for our public school teachers and the budget for public schools provided by the national government are simply inadequate.”

“We decry DBM, DepEd, and DILG’s move of slashing the benefits of teachers in the face of the government’s refusal to grant immediate substantial salary increases and income tax relief and the proposed imposition of new and heavier excise taxes on fuel products as well as the further expansion of VAT,” said Tinio. “We demand that the DepEd, DBM, and DILG amend the new SEF guidelines to reinstate local allowances as allowable SEF expense.”

To highlight their demands for the local allowances, salary increase, and income tax relief and their opposition to the proposals on excise taxes and VAT, the solons will march alongside more than a thousand teachers to Mendiola. They will symbolically tear their payslips to register their opposition to the Joint Circular No. 1, 2017 (DBM-DEPED-DILG) disallowing local allowances for teachers and the proposed new taxes by the DOF.

DepEd: New JC does not prohibit LGUs from providing teachers allowance

Local government units (LGUs) are constant partners of the Department of Education (DepEd) in continuously improving the welfare of teachers and enabling them to cope with the demands of their profession. The LGUs’ support is invaluable in ensuring the effective and efficient delivery of quality basic education for all.

The DepEd, the Department of Budget and Management (DBM), and the Department of Interior and Local Government (DILG) recently issued Joint Circular (JC) No. 1, series of 2017, on the Revised Guidelines on the Use of the Special Education Fund (SEF). This is to update the guidelines and policies on the use and purpose of the SEF as provided under Republic Act No. 7160, otherwise known as the Local Government Code (LGC) of 1991.

Section 4 of the revised JC enumerates the expenditure items that are chargeable against the SEF. Included in the list is the payment of compensation/allowances of locally-hired teachers in elementary and secondary schools identified to have shortages per the teacher deployment analysis of DepEd. Although payment of allowances of nationally-hired teachers is not included, LGUs are not prohibited from granting such. These additional allowances may be sourced from the LGUs’ regular budget or General Fund, subject to existing budgeting rules and regulations.

The revised JC aims to better support the supplementary budgetary needs of schools and learning centers, given the observed practices in the utilization of the SEF and the current developments in the implementation of the K to 12 and early childhood care and development (ECCD) programs. It also aims to ensure a more strategic and efficient utilization of resources for priority programs and projects that would complement and reinforce the budgeting priorities at different levels of decision-making.